Friday, September 18, 2009

Entrepreneurs and Risk

A few weeks ago I spoke with Jason Fried, the 35-year-old co-founder of 37 Signals, who had this advice for aspiring entrepreneurs: “Start a business on the side. Keep your day job.” Fried sounded frustrated with the caricature of entrepreneurs as big risk takers who throw caution to the wind to pursue business ideas. “I think great entrepreneurs don’t really take much risk,” he says. Instead, he advocates thinking long-term, developing a business gradually, and only quitting to do it full-time when it seems like a safe bet — i.e., customers are paying for your product or service.

Interesting article at Business Week.

On the same note, I can remember the talk given during the Founders Institute program (created by Adeo Ressi). I can't quote it exactly, but the similar question was raised:

"Do you think entrepreneurs love risk? Wrong! Everybody hates risk. Nobody likes being under pressure 24x7 and risk everything for something illusory. But entrepreneurs are those who are willing to take the risk for the sake of something more important in their lives. And successful ones learn how to manage the risks wisely."

I can't agree more on that. I would hate to put my family and my own security on my startup, but I'm willing to do this taking a number of precautionary steps that can save me if something goes way wrong. By the way, it's also important to understand when the things are too wrong to continue.

# Posted via web from opportunity__cost